StemCells, Inc. Advances Alzheimer's Disease Program Through Collaboration With Leading Researcher

PALO ALTO, Calif., Apr 18, 2011 (GlobeNewswire via COMTEX) --

StemCells, Inc. (Nasdaq:STEM) announced today that it has entered into a collaboration with Frank LaFerla, Ph.D., a world renowned leader in Alzheimer's disease research, to study the therapeutic potential of the Company's HuCNS-SC(R) human neural stem cells in Alzheimer's disease. Dr. LaFerla's published research has shown that mouse neural stem cells enhance memory in a mouse model of Alzheimer's disease. The goal of this collaboration is to replicate these results using the Company's human neural stem cells.

"This collaboration is a natural evolution of Dr. LaFerla's pioneering research, and will build on the promising results we have seen to date in other preclinical studies of our cells in Alzheimer's disease," said Stephen Huhn, MD, FACS, FAAP, Vice President and Head of the CNS Program at StemCells, Inc. "Our growing human clinical database already includes a favorable safety profile in fatal neurodegenerative disorders as well as proof of engraftment of our HuCNS-SC cells in the brain. Consequently, we will be well positioned for rapid advancement into clinical testing in Alzheimer's disease following successful results from this research collaboration."

Dr. LaFerla, Director of the University of California, Irvine (UCI) Institute for Memory Impairments and Neurological Disorders (UCI MIND), and Chancellor's Professor, Neurobiology and Behavior in the School of Biological Sciences at UCI, stated, "Novel treatment approaches for Alzheimer's disease are urgently needed. From what we have seen to date, we believe that neural stem cells may hold the key to impacting the course of this debilitating disease, and we look forward to working with StemCells to explore this exciting prospect."

Research conducted to date provides a strong rationale for the use of neural stem cells as a potential treatment for Alzheimer's disease. In addition to Dr. LaFerla's groundbreaking research with mouse neural stem cells, which was published in August 2009 in the Proceedings of the National Academy of Sciences (PNAS), StemCells has separately conducted studies of its HuCNS-SC cells in another Alzheimer's model as part of a previous collaboration with George Carlson, Ph.D. at the McLaughlin Research Institute. This research, which was funded by a National Institutes of Health (NIH) Small Business Technology Transfer grant, demonstrated that StemCells' HuCNS-SC cells are capable of surviving in the hostile environment reflective of an Alzheimer's brain, which characteristically features abnormal accumulations of brain lesions called plaques and tangles that contribute to loss of function in healthy neurons.

About Alzheimer's Disease

Alzheimer's disease is a progressive, fatal neurodegenerative disorder that results in loss of memory and cognitive function. Today, there is no cure or effective treatment option. A leading cause of dementia, Alzheimer's disease currently affects more than 18 million people worldwide, a number that is estimated to nearly double by 2025 as the result of our aging population. In the U.S., Alzheimer's disease affects one out of every three people over the age of 80, and costs the healthcare system $183 billion annually.

About HuCNS-SC Cells

StemCells' lead product candidate, HuCNS-SC cells, is a highly purified composition of human neural stem cells that are expanded and stored as banks of cells. The Company's preclinical research has shown that HuCNS-SC cells can be directly transplanted in the central nervous system (CNS) with no sign of tumor formation or adverse effects. Because the transplanted HuCNS-SC cells have been shown to engraft and survive long-term, this suggests the possibility of a durable clinical effect following a single transplantation. StemCells believes that HuCNS-SC cells may have broad therapeutic application for many diseases and disorders of the CNS, and to date has demonstrated human safety data from completed and ongoing studies of these cells in two fatal brain disorders in children.

About StemCells, Inc.

StemCells, Inc. is engaged in the research, development, and commercialization of cell-based therapeutics and tools for use in stem cell-based research and drug discovery. The Company's lead therapeutic product candidate, HuCNS-SC(R) cells (purified human neural stem cells), is currently in development as a potential treatment for a broad range of central nervous system disorders. Clinical trials are currently underway in spinal cord injury and in Pelizaeus-Merzbacher disease (PMD), a fatal myelination disorder in children. In addition, the Company plans to file an IND by year-end 2011 to initiate a clinical trial of HuCNS-SC cells in a retinal disorder, such as age-related macular degeneration, and is also pursuing preclinical studies of its HuCNS-SC cells in Alzheimer's disease and stroke. StemCells also markets stem cell research products, including media and reagents, under the SC Proven(R) brand, and is developing stem cell-based assay platforms for use in pharmaceutical research, drug discovery and drug development. Further information about StemCells is available at http://www.stemcellsinc.com.

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Apart from statements of historical fact, the text of this press release constitutes forward-looking statements within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and is subject to the safe harbors created therein. These statements include, but are not limited to, statements regarding the prospect of the Company's HuCNS-SC cells to enhance memory in animal models of Alzheimer's disease; the prospect of successful results from this research collaboration and advancing to clinical testing in Alzheimer's disease; the potential of the Company's HuCNS-SC cells to treat a broad range of central nervous system disorders; the prospect and timing associated with filing an IND to initiate a clinical trial in a retinal disorder; and the future business operations of the Company, including its ability to conduct clinical trials as well as its other research and product development efforts. These forward-looking statements speak only as of the date of this news release. The Company does not undertake to update any of these forward-looking statements to reflect events or circumstances that occur after the date hereof. Such statements reflect management's current views and are based on certain assumptions that may or may not ultimately prove valid. The Company's actual results may vary materially from those contemplated in such forward-looking statements due to risks and uncertainties to which the Company is subject, including the fact that additional trials will be required to demonstrate the safety and efficacy of the Company's HuCNS-SC cells for the treatment of any disease or disorder; uncertainty as to whether the FDA or other applicable regulatory agencies will permit the Company to continue clinical testing in spinal cord injury, PMD or in future clinical trials of proposed therapies for other diseases or conditions given the novel and unproven nature of the Company's technologies; uncertainties regarding the Company's ability to recruit the patients required to conduct its clinical trials or to obtain meaningful results; uncertainties regarding the Company's ability to obtain the increased capital resources needed to continue its current and planned research and development operations; uncertainty as to whether HuCNS-SC and any products that may be generated in the future in the Company's cell-based programs will prove safe and clinically effective and not cause tumors or other adverse side effects; uncertainties regarding the Company's ability to commercialize a therapeutic product and its ability to successfully compete with other products on the market; and other factors that are described under the heading "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2010, and in its subsequent reports on Form 8-K.

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